Introduction to Compustat North America (WRDS)

Transcription

1 Introduction to Compustat North America (WRDS) Analytics Group Introduction to Compustat North America (WRDS) Authors: Kenneth In Kyun Ernst Jørgensen Last updated: August 2008

2 Introduction to Compustat North America (WRDS) Analytics Group Table contents 1. CONTENTS OF THE DATABASE Compustat Industrial Annually and Quarterly Compustat Bank Annually Compustat Security Monthly Compustat Pension Compustat Industry speficic HOW TO GET ACCESS? HOW DOES IT WORK? Overview company codes and tickers GVKEY SMBL CUSIP/CNUM/CIC DNUM/ NAICS Example searching in Compustat North America QuickSearch: Fundamentals Annual FURTHER RESOURCES... 8

3 Introduction to Compustat North America (WRDS) Analytics Group 1 1. Contents the database Compustat North America contains information on more than 24,000 active and inactive public companies. Compustat North America contains more detailed and specified information than Compustat Global and EMDB. The information can be categorized within the following groups: Company Financials Balance sheets and income statements o Compustat Industrial Annually o Compustat Industrial Quarterly o Compustat Segment o Compustat Index Fundamentals Annual o Compustat Canadian Annual o Compustat Bank Annual Financial markets and prices Compustat, Dividends and Earnings The information in the database is primarily accounting related, which e.g. can be used for valuation purposes. The advantage the database is that it fers restated financials, which gives the opportunity for an easy comparison the companies in the database. 2.1 Compustat Industrial Annually and Quarterly Compustat Industrial is fered in an anually and quarterly version, which refers to the date range available. Industrial fers the most comprehensive search on specific company financial items. Full company financial statements are available under Tools, in which it is possible to extract complete financial statements or part the balance sheet/income statement. The real strenght Industrial is the decomposition company financial items. The decomposed items are not always available for the desired company, which depends on the reporting. An example the grade detail can be made with a comparison the same search in Compustat and Datastream. In this scenario we want information for Novo Nordisk on Plant, Property and Equiptment (PP&E) for the balance sheet.

4 Introduction to Compustat North America (WRDS) Analytics Group 2 Table 1: Datastream extraction balance sheet item Property, Plant and Equiptment Net ($1000) U:NVO NOVO NORDISK A/S TYPE DESCRIPTION 2006 Table 2: Compustat North America Industrial Annually Property, Plant and Equiptment ($MM) A close look at the two searces indicates that Compustat fers both the Gross and Net value PP&E for Novo Nordisk, while Datastream only provides the net value. In this case we have only extracted one element the Asset side the balance sheet. Several other items are available in Industrial with an equal or greater degree detail. 2.2 Compustat Bank Annually In accounting there is a difference between balance sheets and income statements for industrial companies and Banks. Compustat Industrial Annually and Quarterly represent both industrial companies and banks, where the banks financials are represented as Industrial statements. In addition to the information available on banks in Industrial, one can supplement with Compustat Bank annually, which features bank related items on the balance sheet and income statement. 2.3 Compustat Security Monthly Security Monthly provides monthly historical data on the listed securities available in the database. The database contains opening and closing prices, adjustment factors, dividends, shares outstanding etc. The advantage over e.g. Datastream is length the data series available. For Security Monthly the earliest dated security prices are available from January Compustat Pension In the United States pension savings programmes are usually organized by the companies. U.S. companies are thereby obliged to report development in their pension capital. Compustat Pension fers unique information on this area. This kind information is e.g. unavailable in Datastream. A relevant study could be a comparison analysis on pension performance among U.S. companies or a comparsion between U.S. companies and European Pension funds 1. An example statistics available are rate returns, Pension benefits, Pension costs etc. 2.5 Compustat Industry speficic DETAILED WC05350 DATE OF FISCAL YEAR END WC02501 PROPERTY, PLANT AND EQUIPMENT NET Global Company Key Data Date Data Fiscal Industry Format ISO Currency Code Active/Inacti ve Status Marker Property, Plant and Equipment Total (Gross) Property, Plant and Equipment Total (Net) Property, Plant, and Equipment Ending Balance (Schedule V) INDL USD A Often we are not interested in specific companies, but more interested in specific industries. The most popular U.S. industries are categorized as Airlines, Homebuilding, Healtcare Facilities, Managed Healthcare (HMO), Oil and Gas, Retail and Utility. The use these areas could be relevant for strategic analysis in a corporate valuation. 1 Data for the European pension funds would have to be obtained from other sources.

5 Introduction to Compustat North America (WRDS) Analytics Group 3 3. How to get access? Access to Compustat North America is part the Wharton Research Databases Services and is available through the computers at ASB. WRDS is a database portal, which is accessible through Besides Compustat North America the portal fers access to Compustat Global and EMDB, CRSP and NYSE TAQ. 4. How does it work? The following example will illustrate a search on company financials for Novo Nordisk, which is listed on New York Stock Exchange, and thereby available in the database. The primary searching is quite alike in WRDS in general, and the search will thereby act as an example for further searches. 4.1 Overview company codes and tickers Searching in WRDS is available based on different ticker symbols and codes. The following sections will outline the difference and advantages the different codes and tickers GVKEY Compustat has defined a proprietary identifier, the GVKEY, for each company in the database. The GVKEY can be used to track a company over time, while the company name, CUSIP, or ticker may change over time SMBL SMBL can usually, but not always, be identified with the ticker symbol the company's publicly traded common stock. However, the same ticker can be assigned to different companies on different exchanges and company tickers can change over time. For example, the ticker "C" has been used by both Chrysler and Citigroup. Consequently, the ticker symbol is ten an unreliable way to identify companies over time and in different databases CUSIP/CNUM/CIC CUSIP is a ninecharacter alphanumeric identifier assigned to individual financial assets by an independent agency. As a rule, the first six characters the CUSIP can be identified with a company; the next two characters (the seventh and eighth) identify a particular asset (e.g., a class stock or a bond issue) issued by the company; and the ninth digit is a "check digit" to improve the accuracy electronic transmission CUSIPs. Within Compustat, the first six characters the CUSIP are referred to as the CNUM (CUSIP issuer code), and the last three characters the CUSIP are called the CIC (CUSIP issue code). Throughout much the history Compustat data files, the CNUM was used as a company identifier, but it has recently been supplanted in this function by the GVKEY. In any event, the Compustat files do not track a company's CUSIP history. Rather, only the most recent CUSIP or CNUM is included DNUM/ NAICS Until recently, Compustat used its DNUM variable to indicate a company's main line business. This code was generally based on the SIC (Standard Industrial Classification) code created by the U.S. Census Bureau. The Census Bureau is replacing SIC codes with NAICS (North American Industry Classification System) codes. Further, Standard & Poor's and Morgan Stanley have developed GICS (Global Industry Classification System) codes. A company's industrial classification can change from time to time, but the DNUM in Compustat data files generally reflects only the current classification, not the history a company's industry affiliations.

6 Introduction to Compustat North America (WRDS) Analytics Group Example searching in Compustat North America The startup in WRDS gives you the following options By clicking on Compustat North America the following screen appears

7 Introduction to Compustat North America (WRDS) Analytics Group QuickSearch: Fundamentals Annual In our search we want information on the previous 5 years financials for Novo Nordisk. By clicking on Fundamentals Annual, the following screen appears. Specify Fiscal and time period Specify the search: In this example we use CUSIP, but generally GVKEY is preferred, since it allows for unique tracking within The search yields the following results The first part our search specification is now completed. In the next step we need to specify, which parts the financials we want to extract. In this example we will take a look at the information on specific stock options for Novo Nordisk. The following search has to be specified

8 Introduction to Compustat North America (WRDS) Analytics Group 6 Under data items it is possible to specify, which financials to extract from the search. In our example we want information on, which is selected from Data items MZ. By holding down CTRL+ clicking on the specific items you can select the necessary information. By clicking submit request the following window appears Under output format it is possible to specify, which data format to export to. In our example we will export to an Excel Spreadsheet. WRDS fers numerous output formats into the most popular statistical packages and text files. Rightclick on the link, and choose save as. The spreadsheet can now be opened with the available data.

9 Introduction to Compustat North America (WRDS) Analytics Group 7. The resulting output looks as follows Global Company Key Data Date Data Fiscal CUSIP GIC Groups Level Consolidatio n Company Annual Descriptor Industry Format Data Format Population Source ISO Currency Code C INDL STD D USD A C INDL STD D USD A C INDL STD D USD A C INDL STD D USD A Outstanding Beg Company Name Ticker Symbol CIK Number Preliminary Date Acquisitions and Disposals Net Cash Flow Exercisable (000) Exercised () Fair Value Granted Active/Inacti ve Status Marker Granted NOVO NORDISK A/S NVO NOVO NORDISK A/S NVO NOVO NORDISK A/S NVO NOVO NORDISK A/S NVO Outstanding End Outstanding Beg Cancelled Exercised Outstanding End Granted Exercisable Weighted Avg Risk Free Rate Assumption (%) Volatility Assumption (%)

10 Introduction to Compustat North America (WRDS) Analytics Group 8 5. Further resources WRDS fers various manuals online that explains the different data types and how to export the data. Usually the manuals are available at the top each category. The following manuals are available online for Compustat North America.

11 Introduction to Compustat North America (WRDS) Analytics Group 9 THIS GUIDE HAS BEEN PRODUCED BY ANALYTICS GROUP ADVANCED MULTIMEDIA GROUP Analytics Group, a division comprised student instructors under AU IT, primarily fers support to researchers and employees. Our field competence is varied and covers questionnaire surveys, analyses and processing collected data etc. AG also fers teaching assistance in a number analytical resources such as SAS, SPSS and Excel by hosting courses organised by our student assistants. These courses are ten an integrated part the students learning process regarding their specific academic area which ensures the coherence between these courses and the students actual educational requirements. In this respect, AG represents the main support division in matters analytical stware. Advanced Multimedia Group is a division under AU IT supported by student instructors. Our primary objective is to convey knowledge to relevant user groups through manuals, courses and workshops. Our course activities are mainly focused on MS Office, Adobe CS and CMS. Furthermore we engage in elearning activities and auditive and visual communication lectures and classes. AMG handles video assignments based on the recording, editing and distribution lectures and we carry out a varied range ad hoc assignments requested by employees. In addition, AMG fers solutions regarding web development and we support students and employees daily use typo3. PLEASE ADDRESS QUESTIONS OR COMMENTS REGARDING THE CONTENTS OF THIS GUIDE TO ANALYTICS@ASB.DK